Africa cosies up to car makers
If new-vehicle sales on the continent grow significantly, Africa would become the fourth-largest new-car regional market after China, the US and Europe, writes Ryan Bax
Africa is keeping investors on their toes as forecasts for the continent do not match the reality. The inherent volatility and instability of African markets is difficult to grasp fully until seen in hindsight. This happened in 2013, when new-vehicle sales were forecast to exhibit strong annual growth. However, the weakening economies of developing nations, soft oil prices, growing exchange rate risk and a preference for safe havens have seen the new-car market fall annually and even monthly despite the widespread imports of used cars. Africa’s average motorisation level, an estimated 44 vehicles per 1,000 inhabitants, is the world’s lowest. New-vehicle sales in Africa lag significantly behind other regions, with sales estimated at 1.55-million units in 2014. This represents about 1% of global new-car sales and 1.36 new vehicles for every 1,000 inhabitants. This contrasts with 18.05 and 56.94 new vehicles per 1,000 inhabitants in China and the US respectively in 2016. It provides wi...
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